The Securities and Exchange Commission has formally proposed repealing a rule that would have mandated public companies to disclose their greenhouse gas emissions and climate risk exposure. The move, announced Thursday, reverses a signature climate policy from the Biden administration that faced immediate legal challenges after its adoption.
The proposed repeal aligns with President Trump's broader deregulatory agenda and his administration's skepticism of climate-focused financial regulations. Acting SEC Chair Mark Uyeda, appointed by Trump, has positioned the agency against what critics call regulatory overreach. The original rule, finalized in March 2024, required companies to report Scope 1 and Scope 2 emissions as well as climate-related financial risks.
The decision has drawn sharp reactions. Environmental advocates argue that eliminating the rule undermines investor protection and transparency in an era of increasing climate-related financial disruptions. The New York Times reported that business groups had opposed the rule's compliance costs, while the New York Post framed the repeal as a victory for curbing government overreach. The Hill noted the SEC's shift follows a string of legal setbacks for the original regulation.
The proposed repeal must undergo a public comment period before a final vote. If enacted, it would remove the most significant federal mandate for corporate climate disclosure. However, companies may still face state-level reporting requirements and pressure from international investors and stock exchanges that have adopted similar rules.